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Remember when my article "Dump Your 401(k)" was considered by some to be outlandish?

It's possible that the 401(k) plan has failed.

Don't believe it? Take a look at your latest account statement. Hypothetical investment returns run by your employer probably suggest an 8 percent return per year is possible as an average for use in planning purposes. The Standard & Poor's 500, a benchmark that closely mirrors the performance of a significant number of mutual funds commonly found in 401(k) plans, was down for the past decade (December 2000 to December 2010), and a sampling of popular funds offered by major mutual fund complexes suggests that even a 6 percent rate of return over 10 years is unlikely.

Those 8 percent projections may have worked on out on paper, but for anyone hoping to retire over the past few years or during the next half a decade, that 8 percent is likely to prove elusive.

How did we get so dependent on a savings vehicle that has failed so many of us? History provides some insight.

About the Author

Jeffrey Reeves MA, EUREKONOMIST™ has spent almost forty years helping Americans who are trapped in the dysfunctional financial model that incessantly chants the mantra: “You can have everything you need and anything you want as long as you have enough credit!” You can have the sixty inch fl... More